"Private bio/pharma funding rebounded in value in August, though deal counts remain subdued."

August 2025 marked the seventh consecutive month of cautious bio/pharma funding, but with a brighter note: private funding dollars rose sharply compared to July. While deal flow stayed muted, investors deployed larger sums into select companies, signaling a more concentrated pattern of activity.

This update highlights key private market metrics from August and places them within the year-to-date trendline. Read our H1 2025 Bio/Pharma Funding Trends Report.

Funding Activity in August

Private bio/pharma companies raised $3.86 billion across 64 deals in August. This represents a strong increase from $2.08 billion across 70 deals in July.

While the number of financings stayed essentially flat, the average deal size nearly doubled, showing that investors favored fewer but larger transactions. August thus marked the strongest private funding month since February in terms of total capital deployed (FIG 1).

In addition to equity financings, grants emerged as a major feature of August’s private funding landscape. With 15 grant events, they matched July’s level but represented the largest single category of financings by deal count. This underscores how non-dilutive funding continues to play a central role in supporting bio/pharma companies, particularly as venture investment remains selective. While the dollar value of grants is not always comparable to equity financings, the consistency and scale of grant activity highlight their importance as a stabilizing source of capital in the sector (FIG 2).

Early-Stage Activity

Early-stage funding remained under pressure in August. Seed and Series A rounds totaled 11 deals, a sharp decline from 25 deals in July and well below the levels seen at the start of 2025 (FIG 3).

In terms of capital deployed, these rounds raised $211 million in August, down from $473 million in July and far from January’s $2.03 billion peak (FIG 4).

The decline reflects the ongoing caution among early-stage investors. Although August did not bring a rebound, the steadier deal count suggests a possible stabilization following June and July’s troughs.

Read our blog: 2025 Bio/Pharma Funding Trends: July’s Update

Global Distribution of Private Funding

Private bio/pharma funding in August remained overwhelmingly U.S.-centric, though activity was spread across multiple regions:

• United States – $3.39B across 48 deals

• United Kingdom – $66M across 5 deals

• China – $165M across 2 deals

• Japan – $52M (1 deal)

• Sweden – $46M (1 deal)

• Denmark – $40.7M (1 deal)

• Switzerland – $37M (1 deal)

• India – $34.2M (1 deal)

• France – $19.5M (1 deal)

• Netherlands – $10.9M (1 deal)

• New Zealand – $2.8M (1 deal)

The United States alone accounted for ~88% of global private capital, reaffirming its dominance. Europe showed scattered activity across multiple countries, while Asia saw modest contributions from China, Japan, and India.

U.S. Distribution by State

In August, the U.S. accounted for the majority of private bio/pharma financings, with 48 deals totaling $3.39B. Activity was heavily concentrated in California and Massachusetts, but a number of other states registered smaller clusters or single large rounds (FIG 5).

• California (16 deals, $1.35B) and Massachusetts (7 deals, $1.63B) stood out as the twin powerhouses, together representing nearly 90% of all private U.S. funding.

• Secondary activity appeared in Texas (3 deals, $64.6M), New York (2 deals, $74M), and Pennsylvania (2 deals, $20.9M).

• Several states, including Missouri ($115M) and New Hampshire ($32M), hosted one-off large financings, underscoring how isolated transactions can put emerging states on the map.

• Smaller but notable deals were recorded in North Carolina, Virginia, Colorado, Florida, Arizona, Utah, South Carolina, New Jersey, Delaware, Washington, Maryland, and Hawaii (undisclosed amount).

Early-Stage Deals in the U.S.

Early-stage activity remained constrained within the U.S. Out of the total 48 private financings:

• 8 deals were Seed or Series A rounds,

• Together raising $202M.

This represents nearly all of August’s early-stage global activity, yet the totals remain far below 2024 norms. The numbers show that while U.S. hubs continue to dominate private funding, early-stage ventures are still facing headwinds in attracting significant capital (FIG 6).

Public Market Sentiment

In contrast to the subdued private deal flow, public bio/pharma indices delivered another month of gains:

• The XBI (small- and mid-cap bio/pharma) rose from 85.93 on August 1 to 92.88 on August 31 (+8.1%).

• The IBB (large-cap bio/pharma) climbed from 133.04 to 140.41 over the same period (+5.5%).

This marks the third straight month of improvement in public sentiment. While public gains have not yet translated into a broad rebound in private activity, they provide a more supportive backdrop for the sector.

Concluding Remarks

August’s private funding environment reflects a more selective market: fewer financings overall, but a clear uptick in total capital raised. The U.S., and especially Massachusetts and California, continued to dominate the landscape, while early-stage companies remain challenged in attracting capital.

The rebound in public markets adds cautious optimism, but whether this translates into broader private deal activity in the fall remains the key question. For now, August stands out as a month where larger financings carried the sector, highlighting both the resilience and concentration of bio/pharma investment.

Explore BiopharmIQ Funding Activity Dataset!

Article History:

9/18/25 MD, DG

Not legal, investing, or tax advice.